Fill a large pot or wooden flat, which has bottom drainage holes, to just below its rim with sphagnum peat moss. Set one canna lily rhizome in the peat moss with the rhizome's eyes -- the green bumps along the rhizome's top -- facing upward. Bury the rhizome under 2 to 3 inches of peat moss.
Set a drip tray under the pot or wooden flat. Water the container's peat moss thoroughly. Put the pot or wooden flat with its drip tray in a sunny location, and keep its peat moss evenly moist but not saturated.
Select an area in an outdoor garden that receives full-sun exposure and has well-drained soil. If the canna lily is a tall variety, the area must have adequate shelter from wind.
Till the selected site's soil to a depth of 12 to 15 inches with a shovel or spade. Incorporate a 2- to 4-inch layer of compost with the soil.
Plan to transplant the canna lily after all danger of frost passes. Late frosts may kill the canna lily. Dig a hole the same depth as the canna lily''s pot and twice the pot's diameter. If the canna lily is in a flat, make the hole about 4 to 6 inches deep and twice the diameter of the plant's rhizome.
Remove the canna lily from its pot or flat gently, handling it by its rhizome. Put the rhizome in the hole horizontally, ensuring that all parts that are green remain above the ground. Fill the remainder of the hole with soil. Tamp the soil around the plant's base, and water the soil thoroughly. Space multiple canna lilies 18 to 24 inches apart.
Apply a 2- to 4-inch layer of wood chips around the canna lily's base. Mulch helps to control weeds and retain moisture during hot weather. Water the canna lily each week that less than 1 inch of rain falls.